Dow Jones falls 260 points ahead of Fed meeting, big earnings; What to do now

Dow Jones futures were higher in extended trading after the Dow Jones Industrial Average fell 260 points on Monday. The Federal Reserve’s policy meeting headlines the week, along with big earnings results from Amazon (AMZN), apple (AAPL), Alphabet (GOOGL) and Meta platforms (META).


Fed meeting, big earnings results

The Fed’s two-day meeting starts on Tuesday, and the central bank is widely expected to raise the federal funds target by 25 basis points, to a range of 4.5% to 4.75%. Investors are placing a 99% probability of that size hike, according to CME’s FedWatch tool.

Late Monday, Apple supplier NXP Semiconductors ( NXPI ) fell 4.5% in extended trade after reporting fourth-quarter earnings.

Meta’s earnings are due out late Wednesday, while Alphabet, Amazon and Apple earnings are set for Thursday after the close.

Several key earnings this week include Advanced Micro Devices (AMD), Exxon Mobil (XOM), Dow Jones member Merck (MRK) and Starbucks (SBUX). Car manufacturers Ford (F) and General Motors (GM) must also report.

The stock market today

On Monday, the Dow Jones Industrial Average fell 0.8%, and the S&P 500 fell 1.3%. The technology-heavy Nasdaq composite sold 2 percent. Among exchange-traded funds, Nasdaq 100 tracker Invesco QQQ Trust ( QQQ ) fell 2% and the SPDR S&P 500 ( SPY ) fell 1.2%.

Electric vehicle giant Tesla (TSLA) traded down 6.3% on Monday. Among Dow Jones stocks, apple (AAPL) fell 2% and Microsoft (MSFT) fell 2.2% in today’s stock market.

IBD Leaderboard stock Imp (PI), Etsy (ETSY) and Wing stop (WING) — as well as Dow Jones stocks Chevron (CVX) and JPMorgan Chase (JPM) — is among the best stocks to buy and watch, with the ongoing strength of the market rally.

Impinj is an IBD Leaderboard stock. Etsy was a recent IBD Stock Of The Day. Impinj and Wingstop were featured in this week’s Stocks near a Buy Zone column.

4 top growth stocks to buy and watch nowra stock market rally

Dow Jones Futures Today: Oil prices, Treasury yields

Ahead of Tuesday’s opening bell, Dow Jones futures were up 0.15% relative to their real value, and S&P 500 futures were up 0.3%. Technology Nasdaq 100 futures rose 0.3% relative to fair value. Keep in mind that overnight action in Dow Jones futures and elsewhere does not necessarily translate into actual trading in the next regular session.

The 10-year US Treasury yield ticked up to 3.55% on Monday, extending a winning streak to three sessions. Last week, the 10-year yield narrowly ended a three-week loss.

Oil prices fell more than 2% as markets look ahead to this week’s OPEC meeting. West Texas Intermediate futures fell below $78 a barrel. Ministers from the Organization of the Petroleum Exporting Countries and its allies, including Russia (OPEC+), will meet on Wednesday. OPEC is widely expected to maintain current oil production levels, but may discuss possible policy adjustments.

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What to do in the ongoing stock market rally

Now is an important time to read IBD’s The Big Picture column with the stock market trending in a “confirmed uptrend” amid strong gains in recent sessions.

With more encouraging action last week, it makes sense for investors to increase exposure to 60% to 80%. But be ready to move quickly as things can change quickly in the stock market, especially during this week’s news-driven market.

(Check out IBD stock lists like the IBD 50 and Stocks Near a Buy Zone for more stock ideas.)

Five Dow Jones Stocks to Buy and Watch Now

Dow Jones stocks to buy and watch: Chevron, JPMorgan

Energy giant Chevron fell sharply for a second session in a row, falling 2.9% on Monday. Shares broke below the 50-day average support level. Despite recent weakness, CVX stock is adding a handle to a cup base, lowering its entry from 189.78 to 187.91, according to IBD MarketSmith chart analysis.

Banking giant JPMorgan remains in buy territory above a 138.76 buy point despite a 0.9% loss on Monday. JPM stock scores a solid 94 out of a perfect 99 IBD Composite Rating, according to IBD Stock Checkup. The Composite Rating is designed to help investors easily find top growth stocks.

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Top stocks to buy and watch: Impinj, Etsy, Wingstop

IBD Leaderboard stock Impinj ended Monday below 129.12 buy points in a cup base after the recent breakout, as shares fell 2.9% Monday. Look for a decisive retracement of the buy point to signal another chance to buy shares.

Background story: Impinj’s expertise lies in RF (radio frequency) semiconductors to identify, locate and authenticate items. While the company lost money in 2020, the company earned 25 cents per share in 2021. And annual earnings are expected to rise 284% to 96 cents per share this year.

Etsy is back below 137.01 buy points in a cup with handles after Monday’s 2.25% drop. If the stock regains its entry, the 5% buy range goes up to 143.86.

Background story: The company is a provider of an online e-commerce platform where creators of arts and crafts, vintage items and other unique goods go to sell their products. It has a unique business model that in recent years has gone from a niche e-commerce marketplace to a shopping destination across a range of categories.

Wingstop is quickly approaching a buy point at 170.97 in a skewed cup base. Keep an eye out for a potential handle to offer a lower entry.

Background story: The Dallas-based restaurant chain has more than 1,900 locations in the US and international markets, according to Dow Jones Newswires. Its international locations include Mexico, Columbia, Panama, Singapore and the United Kingdom. The company added a net 40 stores last quarter. The earnings will be released on February 22. EPS is expected to grow 71%, with a 40% increase in revenue to $101.1 million compared to the same period last year.

Join IBD experts as they analyze leading stocks in the current stock market rally on IBD Live

Tesla shares

Tesla shares plunged 6.3% on Monday, snapping a six-day winning streak and giving up part of last week’s 33% gain. Despite their sharp decline since January 6, shares remain below the 200-day mark. Tesla stock closed about 56% off its 52-week high.

Early on Monday, the Tesla share was upgraded at Berenberg from hold to buy. The new course target is 200, down from 255.

Dow Jones Leaders: Apple, Microsoft

Among the Dow Jones stocks, Apple shares tumbled 2% on Monday, ending a two-day winning streak. But they are still holding above their 50-day line after strong gains in recent sessions. The stock is still around 20% lower than its 52-week high. Apple will report quarterly results on Thursday.

Microsoft shares fell 2.2% on Monday, finishing just above the 50-day line, which it regained last week. Shares remain 23% off their 52-week high.


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